In 2016, full-year on full-year sales grew by 4% globally, doubling the 2% full-year on full-year increase in worldwide sales reported in 2015. Solid performances in the North American and Asia Pacific markets, which reported growth slightly above the global average, provided the foundations for the 2016 end-of-year results. In other markets, burgeoning sales in Africa were offset by a contraction in sales in Latin America. Overall, the 4% year-on-year increase in worldwide sales was a little below five-year average global growth of 5.7%, as the attendant graph (right and below) indicates.

Africa: Ithuba marks its one-year anniversary
The African region enjoyed the strongest performance over FY 2016, as against FY 2015, with participating African lotteries reporting an aggregate increase in sales of 26.3% for the year-on-year revenue period.

As in the Q3 2016, the main contribution to the performance of the African market came from South Africa’s National Lottery, which reported a fourth-quarter on fourth-quarter rise in sales of 34.3%. The Q4 2016 result saw the lottery’s operator, Ithuba, cementing a successful first calendar year of operations. Commenting on the lottery’s performance, Ithuba remarked, “Ithuba is pleased to announce record lottery ticket sales of over ZAR 5.8 billion in 2016. The lottery operation grows from strength to strength as it continues to deliver on its mandate to re-invigorate the National Lottery in South Africa. Our focus has been to enhance and expand the game portfolio as well as expand the number of retailers and convenient channels available for our lottery players. With positive responses from our market and more expansion on the horizon, we are strongly positioned for a very exciting year of growth in 2017.”

Elsewhere in Africa, other results were almost uniformly positive. Year-on-year, sales at Morocco’s La Marocaine des Jeux and Loterie Nationale were up 19.5% and 9.2% respectively, while at Ghana’s National Lottery, sales were up 7.6% year-on-year. For its part, the Mauritian National Lottery essentially held its own in 2016, thanks to a strong last three months of the year, which saw Q4-on-Q4 sales rise by 13.5%.

North America: January 2016 Powerball draw dominates U.S. lottery year
The North American market also enjoyed a comparatively rosy 2016, with participating North American lotteries reporting an aggregate full-year on full-year increase in sales of 5.7%. U.S. lotteries provided the foundation for this healthy result, which was built around the record-breaking USD 1.6 billion Powerball draw of January 2016. Thus, for example, the Minnesota State Lottery saw its sales rise by 9.9% year-on-year, while the California Lottery saw its sales rise by 9.1% year-on-year, and the Kentucky Lottery saw its sales increase by 8.8% year-on-year.

Commenting on a successful 2016, the California Lottery said, “The single largest contributor to this increase was Powerball, for which sales increased by USD 373,472,135 or 96.1%. This was of course a result of the historic USD 1.6 billion advertised jackpot in January of 2016. The second largest contributor to our year-over-year sales growth was our Scratchers [instant] tickets, which increased by USD 117,838,754 or 2.8%. This growth resulted primarily from existing players moving up from lower price-points to the USD 10 and USD 20 tickets, as well as the introduction of the California Lottery’s first USD 30 price-point game that launched in October of 2015.” Continued the lottery, “The third largest contributor to our year-over-year sales growth was our Hot Spot [keno-type] game, which increased by USD 27,727,076 or 12.7%. This growth was primarily attributable to dedicated efforts to grow the number of retailers selling Hot Spot and offering more promotions. The combined increase in Powerball, Scratchers, and Hot Spot sales account for more than 97% of the total increase in California Lottery sales from calendar year 2015 to calendar year 2016.”

Also in positive territory in the U.S. were the Tennessee Education Lottery, which reported a full-year on full-year increase in sales of 7.6%, and the Florida Lottery, which reported a full-year on full-year increase in sales of 7.1%. In Canada, performances were more muted, with Ontario’s OLG recording year-on-year sales growth of 2.2%, while British Columbia’s BCLC held steady.

Asia Pacific: China Sports does the heavy lifting
Close on the heels of the North American market was the Asia Pacific region, which saw participating Asia Pacific lotteries recording an aggregate full-year on full-year increase in sales of 5.2%. Once again, growth in the Asia Pacific region was driven by the China Sports Lottery, which reported an increase in sales of 13.1% for the twelve months to December 2016, as against the twelve months to December 2015. Meanwhile, full-year on full-year sales at the China Welfare Lottery increased by 2.5%; collectively, the mainland Chinese lotteries saw their year-on-year sales rise by 7.3%. As in previous quarters, sales growth in China was predicated upon the Guess Lottery game, the sales of which increased by 29.8% year-on-year. In all, 27 of China’s 34 provinces (provincial-level administrative divisions), including Guangdong, Hubei, Hunan, Henan, and Yunnan in particular, saw lottery sales grow year-on-year.

Elsewhere in the Asia Pacific region, Hong Kong’s HKJC enjoyed a strong fourth quarter, seeing its Q4-on-Q4 sales grow by 9.3%. As a result, full-year on full-year sales at the Hong Kong Jockey Club increased by 5.1%. In Australia, Lotterywest reported a slight decrease in full-year on full-year sales, while at Japan’s Mizuho Bank, sales of the Takara-kuji lottery also ended down over the same timeframe..

Europe: A successful year for Szerencsejáték Zrt.
In Europe, growth ticked down over the final quarter of 2016, resulting in an aggregate increase in sales of 2.6% for full year 2016 against full year 2015. The European region’s best performer in 2016 was Szerencsejáték Zrt., the Hungarian national lottery, which reported a Q4-on-Q4 increase in sales of 13.7%, for a year-on-year increase in sales of 9.9%.

Commenting on their successful 2016, Szerencsejáték Zrt. flagged their Q4 results, saying, “Comparing sales to previous periods, bookmaker-type sports betting sales were very strong during Q4 2016; moreover, it can be said they considerably exceeded forecasts. Beyond the major tournaments, there were significant sales for smaller sport events as well. During Q4 we were able to work with an increased number of events, so there were many more possibilities for betting. It seems that live betting is becoming more popular among players in Hungary.” The Hungarian national lottery continued, “It is no secret that sales of instant tickets in Q4 were as strong as usual. Especially the seasonal, but more expensive tickets (e.g. Christmas instants) were very popular during the last period of the year.”Other lotteries enjoying a prosperous 2016 included France’s FDJ, which saw its sales grow 4.6% year-on-year, and Italy’s Lottomatica, which saw its sales increase by 4.1% year-on-year.

Elsewhere in Europe, revenues at Greece’s OPAP decreased by a marginal 0.6% year-on-year, exhibiting resilience in an unstable macroeconomic environment, while year-on-year sales at Spain’s SELAE held similarly steady.

At Caixa Econômica Federal, sales for the final quarter of 2016 were down sharply in comparison to sales for the corresponding revenue period of 2015. Rather than reflecting any underlying weakness in the Brazilian lottery market, however, the discrepancy in sales was owing to record-breaking performance of some of the Brazilian national lottery’s products during Q4 2015. In November 2015, the lottery offered the largest jackpot to that point (some BRL 205 million) on its Mega-Sena product, on the basis of a rollover of ten consecutive draws of the Mega-Sena game, while just a month later, a special end-of-year draw called Mega da Virada also helped contribute to the Brazilian lottery’s record-breaking Q4 2015 results.

In Argentina, growth of core lottery products at Nacional Sociedad del Estado continued apace, with a Q4-on-Q4 increase in sales of 17.4% helping to push the Argentinian national lottery to a double-digit increase in year-on-year sales. Beyond these results, Chile’s Polla Chilena continued to impress, growing by 8% over the 12 months to December 2016, as against the 12 months to December 2015. For its part, Mexico’s Lotería National para la Asistencia Pública reported an increase in sales of 4.8% for calendar year 2016, versus calendar year 2015, while sales at Pronósticos held steady over the same comparative timeframes.

Looking forward
The WLA will continue to track the progress of global lottery sales in future editions of the WLA QLSI. Once again we thank all WLA member lotteries participating in this initiative, and look forward to bringing you the first quarter 2017 results shortly.

Philip Springuel
WLA Executive Director

* Based on sales of participating lotteries. Participating lotteries by region:

Africa

Latin America

Ghana: National Lottery Authority

Argentina: Lotería Nacional Sociedad del Estado**

Mauritius: Mauritius National Lottery

Brazil: Caixa Econômica Federal

Morocco: La Marocaine des Jeux et des Sports

Chile: Polla Chilena de Beneficencia

Morocco: Loterie Nationale

Mexico: Lotería National para la Asistencia Pública

South Africa: Ithuba Holdings (RF) (Proprietary) Limited

Mexico: Pronósticos

Asia Pacific

North America

Australia: Lotterywest

Canada: BCLC

China: China Sports Lottery

Canada: Loto-Québec

China: Chinese Welfare Lottery

Canada: Ontario Lottery

Hong Kong: HKJC

USA: California Lottery

Japan: Mizuho Bank Ltd.

USA: Connecticut Lottery Corporation

Europe

USA: Florida Lottery

Czech Republic: SAZKA a.s.

USA: Kentucky Lottery Corporation

Finland: Veikkaus Oy

USA: Minnesota State Lottery

France: Francaise des Jeux

USA: New York State Lottery

Greece: OPAP

USA: Tennessee Education Lottery Corporation

Hungary: Szerencsejáték Zrt.

Italy: Lottomatica S.p.A

Norway: Norsk Tipping AS

Poland: Totalizator Sportowy Sp. z o.o.

Spain: Loterías y Apuestas del Estado

Spain: Organización Nacional de Ciegos Españoles

Sweden: AB Svenska Spel

Switerland: La Loterie Romande

United Kingdom: Camelot UK Lotteries Limited

All WLA members receive the WLA Quarterly Lottery Sales Indicator. Individual sales figures are confidential, and are available only to participating lotteries. Participating lotteries receive a separate, more detailed breakdown of quarterly sales figures. For enquiries regarding participation in the WLA Quarterly Lottery Sales Indicator, please contact Dr. Matthew Spinks (ms@world-lotteries.org) at the WLA Basel business office.

** From Q1 2016 onwards, Lotería Nacional Sociedad del Estado is reporting only on sales of products marketed directly by the lottery; sales from concessions are no longer being reported. The change in reporting measures is due to a change in management policy.